General insurance industry records total premium of RM17.65b in 2017

PETALING JAYA: The general insurance industry, which is expected to remain subdued this year, recorded total premiums of RM17.65 billion in 2017, with growth remaining stagnant compared with the previous year, according to General Insurance Association of Malaysia (PIAM).

It said in a statement that the overall industry displayed resilience with a positive swing in the second half of 2017, rebounding from the 1.9% decline over the first six months.

However, the association noted that while the two largest classes of motor and fire insurance both registered growth, the industry was weighed down by double-digit drops in marine aviation and transit (MAT) as well as personal accident insurance.

Motor insurance grew 1.9% compared with 0.8% in 2016, maintaining its dominant market share of 47.1%, while fire insurance the second largest class with a share of 19.3% recorded a 4.2% growth at RM3.41 billion.

MAT declined 14.6% to RM1.34 billion owing to the weak oil and gas sector, while personal accident insurance registered a drop of 12.6% to RM1.13 billion.

In 2017, PIAM said total motor insurance claims paid out by the industry amounted to RM5.38 billion.

On medical and health insurance, the industry was severely impacted by an increase in the claims ratio, which rose to 71.1% compared with 70.5% in 2016.

Therefore, PIAM said the industry would like to reiterate its call for the government to regulate and make public the recommended retail price of pharmaceutical products and medical apparatus.

The association added that it expects medical insurance premium rates to increase by 15% per year due to higher incidences of chronic and lifestyle diseases coupled with a high inflation rate impacting the prices of drugs and treatments.

Looking ahead, it foresees the operating and business climate to be challenging given the uncertainties prevailing in the global environment.

PIAM is the national trade association of all licensed direct and reinsurance companies for general insurance in Malaysia. Currently, the association has 26 member companies.